Forecasting demand

4 November 2013

A new contract is helping Sainsbury's to make operational stock ordering decisions.

Predicting consumer behaviour based on weather is nothing new. It's common sense that during hot weather people will eat more ice cream and salad for example. However, the extent will vary depending on the actual conditions. In retail it is essential to have exactly the right goods when people want them and, as usual, the devil is in the detail.

Under ordering won't meet demand. Over ordering results in waste, particularly when it comes to perishable foods. That's why we're now helping Sainsbury's understand our view of the weather, which in turn helps them inform their ordering decisions. By ordering wisely, Sainsbury's can reduce waste and save money.

At the Met Office, we forecast across a range of timescales which means Sainsbury's can understand how weather affects sales in the short- and long-term. We have also been working hard to learn the intricacies of Sainsbury's business and its supply chain. Met Office forecasters have spent time with teams from Sainsbury's listening to their requirements and running workshops to fully understand the nuances of the types of decisions they have to make.

Through this detailed understanding, we are developing bespoke services such as helping Sainsbury's to easily visualise weather trends through maps of forecasts 11 days ahead.

Karen Whitworth, Director of Supply Chain at Sainsbury's said: "We really appreciate the value-added services the Met Office provides. Their forecasting services have given us the confidence that we need to make better ordering decisions."